2012 (11) TMI 1193

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....nces of the case the learned C.I.T(A) erred in law in confirming the penalty of Rs. 46107/- U.S. 271(1)(c) of the I.T. Act. 1961. The learned C.I.T.(A) failed to appreciate the facts and explanations offered by your appellant. The action of the C.I.T.(A) being uncalled for and against principles of justice your appellant hereby prays to delete the penalty levied by the C.I.T.(A) in the interest of justice." 2. The facts as recorded in the order of Ld. CIT(A) are stated as under:- "2. BACKGROUND OF THE CASE: The facts of the case are that the assessee is engaged in the business of running of computer hardware training school. The assessment u/s. 143(3) was finalized on 20.12.2007 determining total income of Rs. 6,8....

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....te Bench of this Tribunal has affirmed the view of the Ld. CIT(A) deleted the penalty. The Hon'ble Co-ordinate Bench in M/s. Lucky Star International (supra) has held as under:-  "6. We have heard the learned both the parties, perused the orders of the authorities below and considered the materials on record. During the course of hearing of the appeal the learned DR relied upon the order of the authorities below. On the other hand, the learned AR referring to Para 3 and 4 of the penalty order, submitted that all the additions in respect of commission expenses of Rs. 10,46,163/-, clearing and forwarding expenses of Rs. 2,01,037/- and fees and legal expenses of Rs. 1,10,200/- (totaling to Rs. 13,57,400/-) have been disallowed ho....

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....sed u/s 143(3) on 30th March 2006 whereby total income of the assessee has been determined at Rs. 11.53 Crores. During the course of assessment proceedings Ld. AO found that the assessee had made the provisions in respect of certain foreign payments and claimed these provisions without deducting corresponding TDS. AO disallowed this claim of assessee and levied penalty under section 271(1)(c) relying upon the decision of Reliance (2010-TIOL-21-Supreme Court-II) CIT(A) deleted the penalty - Matter reached to the ITAT.' After haring the parties the ITAT held as under:- ++ there is no doubt that the claim made by the assessee is in respect of business expenses. Had the assessee deducted the TDS and paid it to the Govt. amount then its de....

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.... the assessee was resulted in disallowance of expenditure u/s. 40(a)(ia), that itself cannot be construed as furnishing inaccurate particulars of income or concealment of income. The assessee has failed to deduct TDS which result in disallowance of expenditure. In our opinion, the mistake committed by the assessee was compensated by disallowing the expenditure. Further, the Revenue cannot penalize the assessee by levying penalty u/s.271(1)(c) of the Act. In order to levy penalty u/s. 271(1)(c) of the Act, there has to be concealment of particulars of income of the assessee or the assessee must have furnished inaccurate particulars of its income. Present is not the case of concealment of income or it is not the case of Revenue that the asses....